Home Buying in Brooklyn>Question Details

Ray, Home Buyer in Brooklyn, OH

benefits of first time home buyer

Asked by Ray, Brooklyn, OH Tue Apr 29, 2008

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Ben’s answer
When you buy, you are "throwing away money" at interest and RE taxes. And you are throwing away much more money that way in the first few years. Only after many years would the tide turn and you start "throwing away" less money compared to a renter.

Back to the original question. One big benefit of being a first time buyer is that you don't have an existing house that you must sell first. You purchase is not dependent on you having to sell your current house. This gives you more leverage in negotiating your best deal.
1 vote Thank Flag Link Tue Jul 1, 2008
Manhattan has been insulated from the credit issues affecting most of the country, though the rise in inventories doesn't bode well. Manhattan and the rest of NY are far from immune to downturns. Millersamuel.com only has data back to 1989, but from 1989 to 1995, the median condo/co-op sales price in Manhattan dropped from 240K to 207K. Manhattan had the same space constraints, etc back then, yet prices fell 16%. At the same time, if you dissect smaller sections of the city, their 'Uptown' region declined from a median sales price fof 495K to 465K from 2006 to 2007, so you might want to say that NYC is diff't than the rest of the country, but you can argue that midtown is different than uptown is different than the bronx/brooklyn/etc.

There are certainly people who are good at picking real estate, just like there are people who are good at picking equities or playing a sport. It doesn't mean that everybody else is good at it.

Instead of passing your home on to your kids, chances are that you can invest the money wisely, and pass a brokerage account on to them instead, and they'll be better off.
1 vote Thank Flag Link Mon Jun 30, 2008
I will tell you why. Unlike other cities, New York has no more room to grow. Here in NY the only place we have is to go up, we don't have any free land avaialbe to develope, we are the financial capital and at some point or other everyone wants to live in New York. I don't know anyone who purchased a smart investment and lost money on it yet. Some of the wealthiest people are real estate investors, how could that be possible?
Florida and Cali went bust because people wanted to purchase homes that theyc ouldnt afford, and they were approved for them. I don't know about you, but if I can't afford a Maserati i wont be looking at one no matter how good my % would be on that loan. And that is exactly what happened, people bought Ferraris when they could only afford a Benz.
In New York we have very minimal inventory, and after all of our developments that are going up right now SELL OUT, what are you going to do then? People will start paying premium for a property, because there wont be another option.
AJ we can agree to disagree, I can own a home and pass it on to my children, could you do that with a rental? And if you talk about stocks, unless you are a real expert, how many people make Millions doing it? I have a friend who is a day trader, but makes 90% of his money playing professional poker.
1 vote Thank Flag Link Mon Jun 30, 2008
1%? AJ are you looking at AMERICA AS A WHOLE or are you looking at New York? How can you compare apples to oranges, it just doesn't work that way.
When I think about purchasing a property I am not so concerned with, say Arizona and 50 thousand properties they have on the market, I look and study New York and base my decisions upon that. Very few people lose out on Real Estate investments, and usually when they do, it's because they didn't know what they were doing.
And I still agree that when you rent, it's throwing money away, you aren't building any equity by renting, you aren't living in your own space, building your future. If you move every 2 years, DON'T BUY, no point, if you are planning on starting a family, I would always buy over rent.
1 vote Thank Flag Link Mon Jun 30, 2008
Ray, there isn't a wiser decision you could make than to own your own place. As long as you plan to own it for about 5 years, you will surely do well, and in the long haul your purchase will likely become your nest egg. The pride of ownership is also a feeling that you can't put a price tag on. And we have been so fortunate here in the city and in Brooklyn. As I'm sure you know, Brooklyn is booming. There is tremendous condo construction going on rejuvenating neighborhoods. And there are so many fabulous landmarked brownstone neighborhoods. As a first time buyer, there are often programs that give you wonderful rates - a mortgage broker can give you this information - they have access to more loan programs than an individual bank, but make sure they are very reputable. If you'd like info on specific Brooklyn neighborhoods, I'd be happy to address your questions.
0 votes Thank Flag Link Tue Aug 5, 2008
But if you're paying less money, and saving it away, then you're building savings, rather than equity in a home. You're still saving money, just in a much more liquid form than a house. If you'd always buy rather than rent, you're just being ignorant. Would you have said that 3 years ago in Florida or California or any of the other 20 major markets that Case-Shiller measures? All of which are down over a year ago.

The < 1% stat I quote is based on data since 1890, as far back as I've been able to find, and not avai.able on a more regional level. To say that since NY real estate has gone up in the past, its a good investment for the future is short-sighted. You could say that about stocks or bond or any other assets based on what they've done in some period of time - it doesn't meant they're going to behave like that in the future.
0 votes Thank Flag Link Mon Jun 30, 2008
Renting isn't throwing money away. A typical rental goes for a fraction of what you spend on buying a home when you consider mortgage + taxes + insurance + maintenance. Historically, homes appreciate far less than the stock market and other types of investments, so please don't take the standard Realtor line that renting is throwing away money at face value. Before you consider buying, look at comparable properties for rent and compare them both with the excellent NY times tool: http://www.nytimes.com/2007/04/10/business/2007_BUYRENT_GRAP…

When using it, keep in mind that historically, in the US homes have appreciated at less than 1%.
0 votes Thank Flag Link Sat Jun 28, 2008
Thats easy.

Ray you can finally stop throwing money away on rent, you will OWN something, and you can write off your home during the tax season, and most importantly you can be proud to come home to something that is yours. And build up some equity.
0 votes Thank Flag Link Wed May 21, 2008
I would be more than happy to discuss some 1st time homebuyers programs with you. I have a great lender that I work with that that also could give you all of the ins and outs of buying your 1st home. Many cities also have 1st time home buyer programs. Please give me a call and I will be happy to assist you. This is a great time to buy a home there alot of inventory on the market right now.
Web Reference: http://www.movewithmaya.com
0 votes Thank Flag Link Wed Apr 30, 2008
There are too many to mention here. Most states, cities and counties have first time buyer rates below the norm. The FHA has many programs. Please call a good local realtor or mortage specialist if you know one for all the details. I have finished several deals lately and the clients were extremely happy. It is the best time in your life to buy a home, beleive me! Good luck.
Web Reference: http://www.liveinakron.com
0 votes Thank Flag Link Tue Apr 29, 2008
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